Obama budget chief optimistic on debt deal

WASHINGTON (CNNMoney) -- A bipartisan group of negotiators is "making progress" toward finding a way to both raise the debt ceiling and whittle down budget deficits, President Obama's top budget chief said Monday.

Jacob Lew, the director of the Office of Management and Budget, told the Economic Club in Washington that he's optimistic about getting a deal done within the group headed by Vice President Joe Biden.

Biden has been leading a bipartisan panel from the Senate and House to find a way to cut deficits and raise the debt ceiling. Lew confirmed that has been in on those talks, which will resume Tuesday.

"One of the things that's very promising in the conversations that the vice president is leading is that there's a shared sense of purpose," Lew said. He said the group feels pressure to act now, "because it's not going to be easier to act six months or nine months from now."

The federal government has hit the legal cap on the amount it can borrow, and Congress needs to pass a law allowing the government to borrow more to stay good on its debts. However, Republicans in Congress don't want to raise the amount that the nation can borrow unless they can tie such bigger borrowing to other drastic budget cuts.

Biden's group is heading into its third week of negotiations and still has a ways to go before they get a deal, Lew said.

Lew, who led the same White House budget office during the Clinton administration, said that the environment for cutting a deal with Republicans now is completely different than it was in the 1990s.

"If you look at that environment, in some ways it was less likely than now" that the two parties would reach a deal to get the U.S. fiscal house in order, Lew said. "There was no sense of impending crisis...there was just this sense that it was the right thing to do."

"Now the whole world is watching. Will we be able to get our fiscal house in order?" Lew said.